The labour market in August 2021

Another marked improvement in spite of the summer break

31 Aug 2021 | Press Release No. 31

“The labour market has continued to recover. Unemployment and underemployment have continued to drop sharply, even though it is still the summer break. The growth in employment is gaining momentum.” said the Chairman of the Federal Employment Agency (BA), Detlef Scheele, today at the monthly press conference in Nuremberg. 

Unemployment figure in August:

-12,000 to 2,578,000

Unemployment figure in comparison with the previous year:

-377,000 

Unemployment rate in comparison with the previous month:

unchanged at 5.6 % 

Unemployment and underemployment

After the extensive steps that have been taken in recent months to open up the economy, the number of people who are unemployed dropped again in August 2021 – as it did in July and contrary to what is usual in these months – in comparison with the previous month, specifically by 12,000 to 2,578,000. Adjusted for the season, it declined sharply by 53,000. In comparison with August of the previous year, it fell by 377,000. The unemployment rate is 5.6 %, as it was in July, 0.8 percentage points lower than of August 2020. An increase of 261,000 unemployed people or a rise in the unemployment rate by 0.6 percentage points might be associated with the consequences of the coronavirus crisis. The unemployment rate determined by the Federal Statistical Office in accordance with the ILO Employment Concept was 3.7 % in July.

Underemployment, which also takes changes in the labour market policy and temporary incapacity into consideration, was at 3,345,000 people in August. This was 355,000 fewer than a year ago. 

Short-time work

Before the start of short-time work, businesses must file a report about the anticipated loss of working time. According to the latest data on the verified reports, cyclical short-time work was announced for 68,000 people from 1st to 25th August inclusive.

Current data on the actual utilisation of this is available up to June 2021. According to the provisional projected data of the Federal Employment Agency, a cyclical short-time working allowance was paid for 1.59 million employees in this month. Thus, the utilisation of short-time work is continuing to decline. In April 2020, it reached its peak at just under 6 million.

Gainful employment and employment that is subject to social security contributions

Gainful employment and employment that is subject to social security contributions are currently showing a significant upward trend. According to the Federal Statistical Office, the number of gainfully employed people (on the basis of the domestic concept) rose by 100,000, adjusted for the season, in July 2021 in comparison with the previous month. At 44.97 million people, it was 280,000 higher than in the previous year. Employment that is subject to social security contributions increased by 79,000, adjusted for the season, between May and June. In comparison with the previous year, employment that is subject to social security contributions rose by 463,000 to 33.79 million employees, according to the Federal Employment Agency’s projections. Low-paid employment is also recovering from the measures taken to contain the coronavirus pandemic. In June, this figure was 7.14 million people. Adjusted for the season, this means a perceptible increase of 100,000 in comparison with the previous month.

Demand for labour

The demand for new labour also soared in August. 779,000 vacancies were registered with the Federal Employment Agency, 195,000 more than one year ago. Adjusted for the season, the number of vacancies registered with the Federal Employment Agency increased by 22,000. The Federal Employment Agency labour market index (BA‑X) – an indicator for the demand for labour in Germany – rose in August 2021 by 1 point to 123 points. This means that it is 30 points above the value of August 2020. The BA-X also exceeds the value of March 2020, i.e. the last reporting month before the effects of the pandemic measures became visible on the labour market.

Cash benefits

794,000 people received unemployment benefit in August 2021, 348,000 fewer than the previous year. The number of employable people entitled to benefits in the basic support for jobseekers (Second Book of the German Social Code – SGB II) was 3,802,000 in August. This was 166,000 people fewer than in August 2020. This means that 7.0 % of the people of employable age living in Germany were in need of help.

Labour market

From October 2020 to August 2021, 420,000 applicants registered with the employment agencies and the job centres for a training place. This was 37,000 fewer than in the same period in the previous year. The fall should not be equated with a declining interest of young people in vocational training. Instead, many registrations were prevented by the fact that the usual access routes were impeded and could not be completely replaced by digital alternatives. 84,000 applicants were still unplaced in August. Since October 2020, 500,000 training places have been registered, 14,000 fewer than one year ago. 151,000 of the registered training places were still unoccupied in August. On the whole, the situation in the training market has brightened up. Experience tells us that many unplaced applicants will find a training programme or an alternative in the next few weeks and the training places will be occupied.

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